The Compound and Friends The Bogle Effect
Apr 8, 2022
In this conversation, Eric Balchunas, a Bloomberg Intelligence ETF analyst and author, shares insights on his book, 'The Bogle Effect,' focusing on Jack Bogle's substantial impact on low-cost investing and the ETF industry. They delve into the innovative rise of direct indexing and its potential to outperform traditional investment methods. The discussion also takes a turn toward current market dynamics, exploring ESG's influence on investment strategies. Balchunas provides a humorous take on the evolving landscape of finance and the competitive shifts within major firms.
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Bogle's Impact on ETFs
- Eric Balchunas theorizes that Jack Bogle's influence on the first ETF's pricing was crucial for its success.
- Had it been priced higher, it might have remained a niche trading tool, not a widespread investment product.
Low Cost Investing
- Low cost, not just indexing, is key for investment success, argues Eric Balchunas.
- Jack Bogle's focus on minimizing expenses, including fees and turnover, significantly contributed to indexing's popularity.
Bogle's 'Stay the Course' Philosophy
- Jack Bogle's experience during the 1960s market crash solidified his belief in "stay the course" investing.
- He learned from his mistakes of chasing high-growth and adopted a disciplined buy-and-hold strategy.
